There’s a good chance you’ve heard the statistic that 50% of marriages end in divorce. Luckily, that’s just a tired old myth. Only a certain age group-55 to 64-comes close to that figure at a 43% divorce rate.
Still, divorce is a very real risk in every marriage, and one worth preparing for. Many choose to go with a prenuptial agreement to protect their assets if things go sour. However, does a prenuptial agreement protect all of your past and future assets?
Join us as we take a look at the power of a prenup agreement. We’ll discuss just how much a divorce lawyer can protect you from when a marriage goes wrong.
Table of Contents
What Is a Prenuptial Agreement?
First, let’s make sure we are clear about the term prenuptial agreement. A prenup agreement is a legal document that individuals sign before getting married. This is a detailed summary of each person’s finances, assets, debt responsibilities, and more.
In most marriages, couples manage these things together. They might have separate bank accounts, but they still handle joint purchases such as a mortgage, rent, car purchases, and so on. Upon divorce, you begin the messy process of deciding who keeps what and who is responsible for what.
Naturally, a couple in the midst of a divorce is not going to be the most cooperative. Bad feelings could lead to unfortunate situations where one or both people punish the other by demanding more shared assets. This is why many joke about how divorce ends in the wife taking half the stuff.
With a prenup, both people decide ahead of time how they will handle that situation while they are more clearheaded.
Benefits of Prenups
The obvious benefit of a prenup is that it protects you against a partner who becomes cruel and spiteful if you arrive at a divorce.
Second, it makes things fair. Prenups are great because they are fair for a couple where one person is much wealthier than the other. Done right, a prenup divvies up even a high asset divorce.
Third, and perhaps one of the best, is that a prenup protects you from your partner’s debts. Whether these are old or new debts, you are not responsible for paying what they owe. Even future debts that they acquired during the relationship will be their responsibility to pay going forward.
Does a Prenup Protect Future Assets?
Yes. The whole point of a prenup is to assign ownership and responsibilities even before you get some of the most important assets. After all, there’s a good chance you are going to buy a home, a new car, and other things that need a clear line of ownership.
It also counts for things that would only happen as a result of a divorce. For example, alimony that one partner needs to pay to support children.
Just because an asset isn’t outlined or predicted in this document doesn’t mean the prenup can’t cover it. Think of this as a guide to lead you when the time comes. It encompasses so many of the most common situations in a marriage and how to divide them fairly.
Does a Prenup Protect All Assets?
Now the big question: can a prenup protect all of your assets? You can certainly protect big and important things like bank accounts, debts, shared-owned property, and so on. But can it do every little thing, including small, important things that you might not have considered?
Things a Prenup Does Cover
When you go to a divorce attorney, they will clearly lay out which things a prenup can and cannot cover. They include the following:
- Communal marital property
- Personal finances, like bank accounts
- Debts
- Alimony payments
- Previous children’s inheritances
- Ancestral family property protections
- Estate plans
- Spousal responsibilities
As you can see, this list is quite comprehensive and tackles most of the major issues people have. That said, it doesn’t cover everything.
Things a Prenup Does Not Cover
You guessed it, there are some things that a prenup does not cover. It makes sense, given that this is a document focused on the most important assets in a divorce. Let’s take a look at some things it does not and cannot cover.
Illegal Things
Obviously, anything illegal is prohibited in a prenup. If an illegal provision does make it in, then part of or all of the contract could become void.
Child Custody and Support Decisions
While a prenup can tackle the issue of alimony, it cannot determine who will get custody and how much child support will be.
This also includes waivers of rights that one partner may include as a ploy to avoid paying alimony. A court will strike these down or, at the very least, limit your ability to give up rights to alimony.
Financial Incentives for Divorce
If a provision encourages divorce with the promise of a financial windfall, then the prenup may become void. For example, when a partner gets the inheritance, business stake, or something else belonging to another partner. Many judges will not allow these prenups to come to be or will strike them down when you hold them up in court.
Responsibilities in Personal Matters
Some people expect a prenup to decide how various non-financial responsibilities work in a relationship. That’s simply not how a prenup works. It cannot determine who does what chores, where you spend your holidays, who takes care of the kids, and so on.
To be fair, you could, in theory, create a document that designates those sorts of responsibilities. However, you wouldn’t be able to find a court that would uphold it. Most would view such a thing as silly and frivolous.
Get Your Prenup Today
Most would argue that a prenuptial agreement is the responsible thing to do before any marriage. That said, a prenuptial is primarily about financial matters and those that the court does not decide on.
It cannot help you with deciding who pays child support. Nor does it help decide who does the dishes and whose name goes on the car’s title-among other things.
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